More Than One-Third of HR Pros Say Getting Leadership Support for Pay Transparency Is Biggest Challenge in Addressing Pay Equity

• Only 35 Percent Have a Pay Philosophy That Supports Pay Transparency

Pressure is mounting for Corporate America to address pay equity according to a new pulse survey from Salary.com, a leading SaaS provider of cloud-based compensation market data, surveys and analytics. Sixty-four percent of HR professionals surveyed reported facing more pressure than just six months ago, with 20 percent of those respondents calling the pressure “tremendous.” Current employees and job candidates ranked as the top sources of pressure to get pay right, followed by organization leadership and society at large. The survey, conducted in October-November of 2021, represents responses from 700+ US-based HR professionals.

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Pay transparency remains illusive

More than half of the companies surveyed put HR Directors in charge of pay equity programs, followed by compensation heads, according to the survey. Thirty-seven percent of the HR professionals in the survey responded “yes” when asked if their organization is struggling to address pay equity.

The vast majority (85 percent) indicated they know what to pay their employees to stay competitive and 61 percent have a process in place to address internal pay equity. Yet only 35 percent have established a pay philosophy that supports pay transparency.

This lack of transparency negatively impacts employees: only 34 percent of respondents said that any manager at their organization could honestly and accurately answer “How is my pay determined?” when asked by an employee. Sixty-four percent of respondents do not currently provide wage range disclosures in their job postings, and only 34 percent plan to do so in the next 12 months.

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When asked which areas are proving the most difficult when it comes to addressing pay equity, leadership rose to the top:

• 35 percent: Getting leadership to support pay transparency within our organization
• 17 percent: Integrating our pay equity philosophy into our culture/employee experience
• 14 percent: How to conduct a pay equity analysis
• 14 percent: Finding the right technology, data collection and analysis tools
• 7 percent: Finding someone within our HR organization who can oversee pay equity on an ongoing basis
• 13 percent: Other, including budget and competing priorities

The pay equity advantage in the war for talent

Eighty-one percent of respondents credit the tight labor market for making it more difficult to hire new employees, and an overwhelming majority (95 percent) see pay equity as a competitive advantage in the war for talent.

“A tight labor market has given employees and job recruits the upper-hand in salary negotiations and many are rightfully exercising that power to demand an internally equitable and externally competitive salary,” said Garry Straker, senior compensation consultant at Salary.com. “This survey makes it clear that HR professionals appreciate the value of fair pay when it comes to recruiting and retaining talent. However, it remains to be seen how quickly companies will execute on new pay strategies to meet heightened employee expectations.”

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